Business

Novartis accused of Chinese bribery

The eye care unit at Novartis has been accused of bribing several hundred doctors at several Chinese hospitals in an alleged effort to sell its lens implants. It is claimed that the pharmaceutical company was paying so-called “research fees” to doctors to generate results for non-existent clinical trials. This is the second time Novartis has been accused of wrong-doing in China recently. Previously, Novartis was accused of bribing doctors to increase sales of drugs in China. And Novartis is not alone. Several international pharmaceutical companies in China have been the subject of similar corruption allegations. Both the pharmaceutical giants, Eli Lilly and GlaxoSmithKline, as well as others have been similarly accused over recent months of bribing doctors to increase the sale of some of their drugs within the country. However, the allegations may not be without merit, GlaxoSmithKline recently admitted that some senior executives may have broken the law in China. The investigations continue…

Peruvian overseas debt to increase

Peru’s Finance Minister Miguel Castilla has indicated that the government is planning to issue debt overseas for the first time in two years in an effort to increase public spending. $500 million in bonds will be sold into the international markets and the resulting windfall will be used to increase infrastructure spending. This will be part of a plan to raise $2.4 billion from overseas for next year, and will represent a doubling of this year’s financing. Private investment in Peru has fallen significantly in 2013 mainly due to a reduction in metal exports, a primary driver of the economy. The Peruvian economy grew by only 4.4 percent in June, representing the one of the slowest growth rates in over three years. “We have lower levels of debt compared with countries like Brazil, Colombia and Mexico, which allows us to adopt counter-cyclical policies,” Finance Minister Castilla said during a presentation of next year’s budget, in part to acquiesce concerns about a slow down in the Peruvian economy. The government hopes to increase spending by almost 10% to a record 119 billion soles ($42.4 billion) in 2014, and local bond issuance will reach as much as 2.65 billion soles.

Peru’s potatoes

Mention potatoes in the United States and most people immediately think of Idaho, where more than a quarter of the country’s crop is produced. In Europe, Ireland and its famine or Poland and its vodkas come to mind. But nowhere is prouder of its potatoes than Peru, where they were domesticated more than 7,000 years ago. The country is home to up to 3,500 different varieties of edible tubers, according to the International Potato Centre, whose headquarters are near Lima.

But many Peruvians eat more rice than potatoes; the country even imports frozen chips for use in fast-food restaurants. Only 25 varieties are grown commercially in Peru. Domestic consumption of spuds is about 90 kilos (200lb) per head a year, according to Ismael Benavides, the agriculture minister. That is barely a quarter as much as Belarusians, the world’s champion potato-eaters, manage to chomp through. Nowadays Peru produces only 3.3m tonnes a year, or barely 1% of world output. Peru needs to re-identify with the potato, some in the Peruvian government say.

Peru’s farm exports totalled $2-3 billion a year, including asparagus, paprika and artichokes. Most of these crops are grown on the fertile Pacific coast. But potato exports amount to just $500,000. Officials hope that paying more attention to spuds could help some of the poorest Peruvians. Ordinary white potatoes are grown on the coast. But more unusual—and tastier—varieties survive in the Andean highlands. Peruvian yellow potatoes are prized by gourmets for mashing; tubular ollucos are firm and waxy. As Peru’s rich cuisine becomes better known abroad, demand for these tubers could grow, reckons Luis Carranza, the economy minister.

Some farmers plan to export white potatoes to Brazil. To export yellow potatoes, farmers need to deal with bugs and fungal diseases, and to produce on a larger scale. The Peruvian government wants to see processing plants in the highlands that would turn out potato starch and powder. The government has plans to draw up a registry of some 30 varieties for which it would fix a denomination of origin.

Whether that is the best way to promote potato exports is debatable. In Cutervo, the centre of a big potato-growing region in the northern highlands, farmers have yet to find a way to turn potatoes into prosperity. The European Union is paying for a pilot processing-plant in the town. But the mayor, Wilson Delgado, complains that prices for the crop are low, while those for fertilisers are rising. He worries that Peru’s recently approved free-trade agreement with the United States will lead to a flood of subsidised imports. That fear is probably exaggerated. But it is certainly time for Peru to make more of its potato patrimony.

Illegal logging in Peru

The Peruvian government has, in the past, tried to regulate logging in the Peruvian Amazon. The original system involving annual contracts that were made with loggers had been replaced by auctions of 40-year concessions of specific areas of the Amazon. Under this new system, loggers had been permitted to log 5% of their licensed area each year, in the hope that this would lead to more sustainable practices. Unfortunately, this has not been so forthcoming as loggers have routinely overestimated the number of harvestable trees within their site allowing them to harvest more trees than they would have otherwise been allowed. To make things worse, some loggers have even gone as far as logging adjacent land located within nature reserves to fulfil their allocated quotas. And as loggers have moved into these restricted areas, they have come up against isolated indigenous tribes resulting in violent clashes and deaths. This has led to the questioning of this new scheme especially since it is estimated that just as much timber is illegally exported as under the old system. The United States Congress has recently waded into the row by enforcing stiffer regulations on imported timber from Peru. This has not been welcomed by Peru and it is unclear whether it has had much effect on the illegal logging trade.